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Best Auto Insurance Companies 2021
With so many choices for auto insurance companies, it can be difficult to know where to start in finding the right auto insurance. We’ve evaluated insurers to find the best auto insurance companies, so you don’t have to.
You have the keys. You have the car. Now all you need is auto insurance and you are good to go. Here is an overview of the common types of auto insurance coverage.
What does liability insurance cover?
Automobile liability insurance covers you when you cause property damage or injury to someone else. For example, if you cause an accident and the other driver breaks their arm, your liability insurance will pay for the medical bills and damage to the other vehicle. Liability insurance also covers legal costs if you are sued due to a car accident.
When you purchase automobile liability insurance, you have the option of choosing the limits of your policy. You will often see limits written as a series of three numbers. For example, you might see it written as 20/40/10. That means:
- $ 20,000 personal injury / death coverage for one person per accident
- $ 40,000 in bodily injury / death coverage for more than one person per accident
- $ 10,000 in Accidental Property Damage Coverage
You must purchase auto liability insurance in most states. It is a good idea to purchase more than your state’s minimum requirement. This is because you have to pay for any amount that is over your policy limits and you could be sued for the balance. In general, you want to have sufficient liability insurance to cover what you might lose in a large lawsuit.
What does uninsured motorist insurance cover?
If an uninsured driver hits you, Uninsured Motorist (UM) coverage pays for your injuries and, in some states, damage to your car. It also covers your passengers and family members who live with you. In addition to medical bills and auto repair bills, it covers funeral costs and lost wages. Uninsured motorist insurance also covers you if you are struck as a pedestrian.
Coverage for Underinsured Motorists (UIM) is similar to UM. It pays for medical bills and other expenses if a driver with insufficient insurance hits you.
Unified Messaging is required in some states and optional in others. Generally, Unified Messaging is a good cover to have. One in eight drivers is on the road without auto insurance, according to the Insurance Research Council.
If you buy UM, you will usually need to match your auto liability insurance amounts. For example, if you have liability limits of 100/300, you will need to purchase MUs for that amount.
What does collision and damage insurance cover?
Collision insurance and comprehensive insurance are often sold together, but they are two separate types of coverage.
- Collision insurance pays to repair or replace your car if you hit another car or other object (such as a fence, railing, or tree).
- Back to back insurance pays to repair and replace your car if it is stolen or damaged by fire, flood, hail, vandalism, falling objects (such as a tree branch) or a collision with an animal.
Collision insurance and comprehensive insurance are optional types of coverage in terms of state laws. But if you have an automobile loan or lease, your lender or leasing company will likely require you to purchase both types of coverage.
Collision insurance and accidental damage insurance both have an insurance deductible. Deductibles are usually amounts such as $ 250, $ 500, $ 1,000 and more. A deductible is the amount deducted from an insurance claim check. For example, if your auto repair bills are $ 2,000 and you have a deductible of $ 500, the insurance payment will be $ 1,500.
A higher deductible will lower your auto insurance premium, but make sure you can afford to pay that amount out of pocket.
Personal accident insurance and collision insurance only pay up to the actual cash surrender value of your car. (For example, if your car is totaled.)
Medical payments and personal injury protection
Medical payments are often referred to as “MedPay”. It covers medical costs for you and your passengers, regardless of who is responsible for the accident. MedPay is often sold in small quantities and is not available in all states.
Injury Protection (PIP) is similar coverage that pays medical bills and other expenses for you and your passengers, regardless of who is responsible for the accident. The PIP also covers other expenses such as lost wages, rehabilitation costs, funeral costs and survivor benefits, as well as services that you cannot perform due to injuries such as cleaning the house. or childcare.
PIP is required in some states. In other states, PIP is optional or not offered. In states where this is required, there is a minimum amount required by state law, but you can purchase more. In states that offer it, but don’t require it, you can choose the amount of coverage that works best for you.
Other types of auto insurance
Auto insurance companies offer several types of optional coverage that you can purchase to tailor a policy to your needs. Here are some common types of coverage:
- Forgiveness of accident. If you do cause an accident, this coverage will “forgive” you, which means your rates will not go up. The rules vary among insurers, but in general, you will get one accident forgiven by policy for a specific period, such as every three years.
- Gap insurance. This coverage pays the difference between what you owe on your loan or rental and the insurance payment if your car is destroyed or stolen. For example, if you owe $ 25,000 but the total value of your car is $ 22,000, the gap insurance would pay the “gap” of $ 3,000.
- Rent reimbursement insurance. This insurance will cover the cost of car rental and public transportation costs while your car is in the repair shop due to a problem covered by your policy, such as a car accident.
- Carpool insurance. If you’re a driver for a rideshare company like Uber or Lyft, there may be a lack of coverage when you receive a ride request and are about to pick up a passenger. If you have a car accident during an interval, you may not be covered by your insurer and the rideshare company. This coverage helps to fill this gap.
- Roadside assistance insurance. This coverage pays for services like a tow truck, locksmith, refueling, changing a flat tire, or starting a dead battery if your car breaks down.
What does auto insurance cover FAQ
How Much Car Insurance Do I Need?
A good way to determine how much auto insurance you need is to start with auto liability insurance. A general rule of thumb is to buy enough auto insurance to cover what you might lose in a lawsuit. You can be sued for damages beyond the limits of your coverage, so it’s prudent to purchase liability insurance in amounts that protect your assets, savings, and home. At the very least, you want sufficient liability coverage to pay for a serious accident, like 100/300/100 limits.
If uninsured motorist coverage is available in your state, it is wise to purchase it. It covers your medical bills and other expenses (like pain and suffering and lost wages) if an uninsured driver hits you.
You can get coverage for auto repair bills by adding collision insurance and comprehensive insurance. If you need even more coverage, you can fill those gaps with optional types of coverage like gap insurance and rental reimbursement insurance.
How to buy auto insurance?
When you are ready to purchase an auto insurance policy, the first step is to determine the types of coverage and the amounts that you will need. Next, it is a good idea to compare car insurance quotes from several insurance companies. Indeed, prices vary from one insurer to another for exactly the same coverage.
You can usually get auto insurance quotes online or by speaking with an independent agent over the phone or in person. Be sure to compare quotes for identical coverage amounts and ask for discounts. Auto insurance quotes are always free.
But keep in mind that the cost isn’t everything. If you have to file an insurance claim, you want a company that has a good reputation for customer service. The best auto insurance companies combine exceptional service with a reasonable price.
What does full coverage auto insurance mean?
The term full coverage auto insurance generally refers to a policy that includes liability insurance, collision insurance, and comprehensive insurance.
Liability insurance covers property damage or injury that you cause to someone else. Collision insurance and comprehensive insurance cover damage to your car caused by a multitude of issues. These include car accidents, auto theft, vandalism, fires, floods, falling objects, hail and collisions with animals.
The national average cost for full coverage auto insurance is $ 1,998 per year for a 100/300/100 liability policy and full, collision and uninsured motorist coverage.